Energy Risk Management for UK Business

An LSE Enterprise white paper written by Dr Samuel Fankhauser at the Grantham Research Institute demonstrates that energy risks for business are set to increase. Sponsored by npower, the paper provides a guide to current energy risks and forecasts how they will grow in the future. It shows that combining energy management and procurement processes can help control risk exposure and points out that energy suppliers can usefully act as consultants to help organisations manage energy risks.

'The risks faced by UK business related to energy will continue to grow. Energy price volatility and increases, reputation and price risks from carbon regulation, and increasing regulatory and technological complexity all combine to ensure energy will continue to pose a significant risk for UK businesses moving forward,' says Dr Fankhauser.

'As a result, businesses should ensure they are best-placed to manage these risks, by developing an integrated strategy with board-level support that brings together the management of energy consumption and energy procurement. This will be a step-change for many organisations, but it is crucial they do this now so they can take advantage of cost and carbon savings and the reputational benefits of successful regulatory compliance and energy management.

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